It is a good time to conduct an internal audit of I-9s because inspections and fines have not gone away and a new I-9 edition was published recently. An administrative law judge in the Office of the Chief Administrative Hearing Office fined a staffing company $276,000 in June 2017, reduced from the $367,000 originally imposed by Immigration and Customs Enforcement (ICE). While this is less than the highest fine of $605,250 imposed in 2015 on an events planning company for incomplete I-9s (there were only four missing I-9’s out of 339 employees), the reason for the staffing company’s fine was a failure to produce the I-9s to ICE within the three days of its request. So, Rule No. 1 taken from this latest large ICE fine: Have complete I-9s ready and available for inspection at all times.

Second, use the latest Form I-9. A new I-9 Form went into effect on July 17, 2017. The Jan. 1, 2107 version can be used until Sept. 17, 2017. After that, employers must only use the July 17, 2017 iteration. Rule No. 2: Never rely upon pre-printed I-9 forms. Always go to the website and download the latest version.

Here is guidance from ICE and the Office of Special Counsel at the U.S. Department of Justice (OSC) on parameters of a permissible internal audit.

While internal audits are neither required nor specifically recommended by ICE or the OSC, if pursued, the scope of the audit must be pre-determined. Since an employer can choose to review all or a sample of I-9s, it is critical that the selection of a sample be based upon neutral criteria.

An internal audit is not allowed for any discriminatory reason. While an employer must ensure that the audit is not based on citizenship, national origin or other discriminatory reason, the timing of the audit can be inadvertently discriminatory if based upon a tip that could be based upon discrimination or retaliation and does not appear reliable. The employer should have its internal audit process set up in advance, including how, what and when it will communicate with affected employees.

If the audit uncovers an error in Section 1 of the I-9, the employee must be contacted to correct the error, drawing a line through the incorrect information, entering the correct or missing information, and initialing and dating the new entry of information.

An employee with a deficient I-9 should be notified, provided with a copy of the I-9 and any attached documentation, and directions on how to obtain missing or inaccurate information.

If the audit uncovers photocopies of documentation that do not appear genuine, the employer should address its concern to the employee and provide the employer with the list of acceptable documents that accompanies the I-9 instructions. The employer must never request a specific document and cannot terminate an employee unless the employee cannot prove identity and/or work authorization.

ICE presumes that an employer acted reasonably if, as a result of an internal audit, it provides a reasonable length of time for an employee to supply adequate identity and/or employment authorization documentation. Ten days is only binding upon an employer responding to a Notice of Suspect Documents from ICE. Thus, employees should be given more time as some documents take longer to obtain. In fact, an employer can allow or disallow additional time based upon objective non-discriminatory and non-retaliatory criteria, and then document the basis for its decision and efforts of the employee to obtain the acceptable documentation.

An employee who was not employment authorized and subsequently becomes employment authorized should not be terminated.

A new I-9 should not be required if an existing I-9 appears deficient: The old form should just be corrected. If a new I-9 must be used because the original I-9 lacks space for corrections or is damaged, it should be stapled to the deficient I-9 if it exists.

If the employee has left employment when the error is discovered, the employer should attach a signed and dated statement to the I-9 identifying the error and the reason the employee cannot complete or correct the error.

Does enrollment in E-Verify supplant the need for an internal audit? No. E-Verify provides a defense related to an employer hiring someone who is not employment authorized but does not offer a safe harbor for I-9 violations.

Final thoughts: An employer is considered to “know” an employee is not employment-authorized through actual knowledge and “knowledge which may be fairly inferred through a notice of certain facts and circumstances that would lead a person, through the exercise of reasonable care, to know about an individual’s unlawful employment status.” When doing an internal audit, an employer may become “knowledgeable,” applying either of the above definitions, about a legitimate employment eligibility issue. An employer who has actual or constructive knowledge that an employee is not employment authorized, yet continues to employ that individual, can incur heavy fines and even imprisonment for both company owners and managers. Therefore, a carefully conducted internal audit may require appropriate follow-up as itemized above.

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